Gotabaya seeks additional $1.1 billion SWAP facility from Modi

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Sri Lankan President Gotabaya Rajapaksa on Saturday sought a “special” $1.1-billion currency swap facility from Prime Minister Narendra Modi to boost its foreign exchange reserves under strain in the wake of the coronavirus pandemic.

The Central Bank of Sri Lanka had recently sought a $400-million currency swap with the RBI under the SAARC facility. Mr. Rajapaksa told Prime Minister Narendra Modi over telephone that the additional amount “to top” the $400 million “would enormously help Sri Lanka in dealing with our foreign exchange issues,” according to a statement issued by the President’s office here.

Mr. Modi called Mr. Rajapaksa to discuss the challenges and bilateral cooperation during the pandemic, Colombo-based official sources said. With COVID-19 delivering a huge blow to the global economy, Sri Lanka too is reeling under its impact, especially as it prepares to service $2.9 billion of its external debt this year.

Mr. Modi assured that he is personally committed to help Sri Lanka, the President’s office said. “We are ready to help under terms that are favourable to Sri Lanka,” Mr. Modi said, according to the press statement.

Following Saturday’s call, Mr. Modi said in a tweet: “Had an excellent talk with President @GotabayaR. Sri Lanka is fighting COVID-19 effectively under his leadership.”

 

Mr. Rajapaksa told Mr. Modi: “I believe India has managed the COVID-19 pandemic well,” and commended his government’s stimulus package.

 

He added: “Friendship of centuries & bonding of culture & religions will continue to be the basis of the relationship between #India & #LKA. Thank you HE Shri @narendramodi for your hand of friendship during trying times. We will continue to stand by #India.” Mr. Rajapaksa also thanked Mr. Modi for support, including 10 tonnes of medical supplies to combat COVID-19, the official statement said.

The call between the leaders comes over a week after Chinese President Xi Jinping spoke to Mr. Rajapaksa over telephone, suggesting that the two countries “gradually resume practical cooperation in various fields, advance major cooperation projects in an orderly manner and promote the high-quality construction of the Belt and Road Initiative (BRI).”

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